The Consumer Prices Index (CPI) rate of inflation increased to 2.1 per cent in April 2019, up from 1.9 per cent in the 12 months to March 2019, the Office for National Statistics (ONS) has revealed.

The ONS said the Consumer Prices Index including owner occupiers’ housing costs (CPIH) 12 month inflation rate was 2 per cent in April 2019, up from 1.8 per cent in March 2018.

Rising energy prices and air fares, which were influenced by the timing of Easter, produced the largest upward contributions to change in the rate between March and April 2019.

However, the largest offsetting downward contribution came from across a range of recreational and cultural items, which included computer games and package holidays.

Commenting, Smith and Williamson manager of the Global Inflation-Linked Bond Fund said: “UK inflation is on its way back up, and as we expected the trend down in inflation has proved to be a temporary phenomenon.

“We think there is further scope for UK inflation to rise in the coming months – not least because tax changes have reduced the supply of rental properties relative to demand, and this will push up inflation in private sector rents.

“Utility prices are also on the rise and the recent damage to oil production infrastructure in Saudi Arabia poses uncertainty and upside risk as far as Brent crude oil prices are concerned.”

In addition, Hargreaves Lansdown senior economist, Ben Brettell, said that higher inflation would usually bring pressure on the central bank to raise interest rates – but these are far from normal times.

“The Monetary Policy Committee (MPC) is rightly reluctant to tweak policy while Brexit hangs over the economy like the Sword of Damocles. Moreover, fuel and energy prices are notoriously volatile from month to month, and are usually led by factors outside the control of domestic monetary policy.

“I’d expect the headline rate to fall back as we move through 2019. Core inflation, which strips out these volatile components, remained unchanged at 1.8 per cent. So today’s data changes little - the absence of domestic inflationary pressure means policymakers have licence to leave rates on hold for now.

“This was borne out in the market reaction, with sterling little changed on the news. This muted response shows traders haven’t adjusted their prediction that the Bank of England’s (BoE) wait-and-see approach will hold firm at its next meeting on 20 June.”

Despite April's rate of inflation being higher than the BoE's target level of 2 per cent, the figure is slightly below the expected 2.2 per cent. However, The Share Centre investment research analyst Ian Forrest added that the news "will worry consumers" as real wage growth comes "under threat" once again, following a year of inflation running below wage growth.

"Despite the headline figure being slightly below expectations it was only just shy so the reaction from the markets was muted. It is unlikely that these numbers will alter the MPC’s thinking in relation to interest rates. Brexit remains the main factor influencing the committee and with the figure only just above the target level there is little need to move yet," Forrest concluded.

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